The number of unsold uncompleted private residential units has sunk to a record low, but offsetting that trend, the rising number of unsold completed units may lead to lower prices next year, say analysts.
According to the Urban Redevelopment Authority, there were just 20,577 unsold uncompleted private residential units as of Sept 30 - the lowest number since the authority began collecting data in 2001.
But there has been a steady rise over the last three quarters in the number of unsold completed private residential flats since the last quarter of last year, when the number stood at 1,275. As of September this year, there were 1,925 unsold completed units nationwide.
Despite the steady uptick, analysts interviewed by The Straits Times said the rising trend has not yet reached levels of concern.
Mr Desmond Sim, CBRE Research head for Singapore and South-east Asia, noted that the historical high of unsold completed units was in the second quarter of last year, which was at 2,470 units.
"The unsold completed units in the city fringe and suburbs are gradually rising. However, for now, the numbers are not at an alarming stage and it is possible for developers to reduce this stock in view of limited new launches in the coming year," he said.
Mr Nicholas Mak, head of research and consultancy at SLP International Property Consultants, said the number of unsold completed units was still small compared with the overall average number of units which developers sell in a year, which is about 12,000. He said that in that context, "the authorities would not be too concerned".
The core central region made up most of the unsold completed units, with 753. There were 543 units in the city fringe and 629 in the suburbs.
This is unlike the unsold uncompleted units, where the lion's share of these units are in the suburbs, which make up the largest geographical area.
Mr Sim explained that many of the unsold completed sites came from collective sales, most of which have been completed and are in the prime district. But most of the supply of residential sites come from government land sales, which are mostly in the suburbs.
The Straits Times understands that several projects in the east make up a significant portion of unsold units, while the Redhill area accounts for 1,700.
Several analysts noted that developers with unsold completed units would be worried, as Additional Buyers' Stamp Duty (ABSD) penalties loom. Under ABSD rules, introduced in December 2011, developers are required to build and sell all new units within five years of land possession, or pay a 10 per cent levy - later raised to 15 per cent for sites bought from Jan 12, 2013.
"It would be easier to cut prices and sell rather than pay the penalty," said Mr Mak.
Mr Ong Kah Seng, director of R'ST Research, said he expected cheaper prices in the suburbs next year from the increased unsold completed units there.
"The projects for which the sites were bought in 2013 will likely be affected by the looming ABSD deadline. I expect 2017 to be the time for developers who bought sites in 2013 and 2014 to quickly sell off their projects via price cuts," he said.
Dr Lee Nai Jia, head of South- east Asia research at Edmund Tie and Company, said evidence of developers cutting prices has been mixed. While some do face pressure to do so, others "tend to refrain from doing so as it might antagonise buyers who bought the units before the price cut".